Abstract
Offering higher wages may enable firms to attract more applicants and screen them more carefully. If firms compete in this way in the labor market, "selection wages" emerge. This note illustrates this wage-setting mechanism. Selection wages may engender unconventional results, such as a pre-tax wage compression induced by the introduction of a progressive wage tax.
Item Type: | Paper |
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Keywords: | wage formation, efficiency wage, incentive wage, mobility, job-specific pay, wage-tax |
Faculties: | Economics Economics > Munich Discussion Papers in Economics Economics > Munich Discussion Papers in Economics > Labor Economics > Chairs > Chair of Institutional Economics (closed) |
Subjects: | 300 Social sciences > 300 Social sciences, sociology and anthropology 300 Social sciences > 330 Economics |
JEL Classification: | J31, J41, J62, J63 |
URN: | urn:nbn:de:bvb:19-epub-958-8 |
Language: | English |
Item ID: | 958 |
Date Deposited: | 13. Dec 2006 |
Last Modified: | 08. Nov 2020, 05:29 |